Domino’s CEO
announced he will be departing, Papa John’s CEO
just left and Papa Murphy’s
CEO is still listening to
franchisee
so the oldest legacy national pizza brand that has capitulated market share for
20 years is stepping up. So what do you think they are doing now?
Well according to Steven Johnson, Grocerant Guru® at
Tacoma, WA based Foodservice
Solutions®
“under the skillful tutelage of Yum! Brands CEO Greg
Creed Pizza Hut will be empowered to leverage product
innovation, pricing, and marketing acumen to position Pizza Hut with
top-of-mind customer relevance driving top line sales and bottom line profits.
Pizza Hut announced
its $5.99 Medium Two-Topping pizza deal, the first of its kind for the
Yum! Brands chain. Pizza Hut is
targeting its primary target customers while firing a warning shot to the pizza
sector they mean to garner market share in 2018 as they leverage price to gain
a larger share of stomach according to Johnson.
Zipporah Allen, vice
president of marketing for Pizza Hut stated "Great tasting pizza at a great
price is a no-brainer,” ... “We know our pizza stands above the
rest, so we’re excited to give our customers an offer
to satisfy their craving.”
According to Johnson,
McDonald’s success with deliver help expand the food
delivery space all the while empowering consumers to choose something other
than pizza as a first choice for the office get together, family meal, or
student non-traditional meal leaving the pizza sector a bit flat footed.
The consumer is
dynamic not static and clearly Yum! Brands CEO Greg Creed understands that the
retail foodservice business model is evolving fast and brands must evolve as
fast or fasters according to Johnson. In fact Pizza Hut announced a global
partnership with Toyota to look at the future of pizza delivery with a
self-driving car the Toyota E-Palette.
Let’s be clear here
the foodservice space is evolving very fast, as regular readers of this blog
know department store chain Kohl’s is planning to partner
with retailers like convenience stores or grocery stores to lease the white
space left by the roughly 300 stores it has “right-sized” over the past several
years, CEO Kevin Mansell told CNBC just yesterday. Let’s admit it, most retailers know that
Grocerant niche fresh food is booming.
That was just in case you missed it according to Johnson. That is the a
contributing force driving restaurant chains to evolve or fade away if they
want to admit it or not.
Johnson believes legacy restaurants
must invest in garnering segment market share in 2018 any way they can because
the fast evolving retail foodservice business model is going to displace those
who do not. By now you know that Walmart & K Mart raised both wage
and employee benefits. The increases to $11 per hour while simultaneously
expanding maternity and parental leave benefits have elevated the restaurant
employee retention and acquisition problem to a new high, one where yesterday’s
solutions are today’s quagmire.
The undercurrents conditions impacting
the growth of the foodservice sales have been well documented by the team at
Foodservice Solutions®. We ask is your
restaurant, c-store, or service deli prepared for today’s retail conditions or
yesterdays. Why do we ask?
Well, recently we spent time listening
to many foodservice CEO’s talk about implementing delivery as a strategy. It’s kind of like thinking restaurant
delivery is the answer to sales woes. Restaurant
food delivery is integral and maybe required in-order to maintain customer
relevance today. However we must caution
operators that food delivery as a strategy was valuable 20 years ago. Today,
food delivery is simply a marketing tactic of yesterday.
Today food delivery is simply a tactic
being implemented by followers who were unable or unwilling to see the forest
through the trees back in the day or last year.
It must be noted if a food company is touting food delivery as a
strategy the only thing clear is that they still don’t see the forest as the
weeds they are standing in are simply too high according to Johnson.
In Q4 2017 restaurant same-store
traffic declined 1.9% in the fourth quarter, including a 1.8% decline in
December after very weak numbers in 2016.
That my friends is an example once again that the restaurant business
model is broken. Has your brand created
a new platform capable garnering incremental customers and sales while driving
store cost down edifying the franchisee while driving corporate profit? Why
not?
Success does leave clues www.FoodserviceSolutions.us is the global leader in grocerant niche
business development. We can help you
identify, quantify and qualify additional food retail segment opportunities. Has your company had a Grocerant ScoreCard
completed a Grocerant Program Assessment, or new Grocerant niche product
Ideation? Want one? Call 253-759-7869 Email: Steve@FoodserviceSolutions.us
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